OTAs: The Marmite Effect in Hotels. Love Them or Hate Them, Here’s How to Take Control

Table of Contents

• The Marmite Effect of OTAs in Hotels
• The Strengths of OTAs
• The Dark Side of OTAs
• Bidding on Your Brand: Defend Your Own Turf
• The Meta Search Problem: And Why Weekends Hurt
• Advertising on OTAs: Paying to Play
• Rate Parity: Myth or Minefield
• Accountability: Tracking ROI and Channel Costs
• The Balanced Verdict

If there’s one subject guaranteed to split a room of hoteliers, it’s OTAs. For some, they’re the perfect partner, filling beds in low season and giving instant visibility. For others, they’re a necessary evil that erodes margins, steals guest loyalty, and locks hotels into commission dependency.

Like Marmite, OTAs provoke strong feelings. But here’s the reality: they aren’t disappearing. The real question isn’t whether you should use them, but how you make them work for you without losing control of your brand and your direct bookings.

The Strengths of OTAs

Let’s start with why OTAs became the giants of distribution in the first place:

• Global reach: They invest millions in SEO, PPC and metasearch, putting your hotel in front of audiences you’d never reach alone.

• Guest trust: OTAs have nailed the convenience factor. Guests love the ease of comparing, reading reviews and booking in seconds.

• Demand generation: In shoulder or low seasons, OTAs can help keep occupancy ticking over when your direct traffic is quieter.

Used strategically, OTAs can be a valuable part of your mix.

The Dark Side of OTAs

Of course, there’s a sting in the tail:

• Commission drain: With fees of 15 to 25 percent, OTAs often eat the margin you fought hard to protect.

• Rate parity battles: Hotels are pressured into “best rate guarantees” yet OTAs undercut with opaque discounts, mobile-only rates and closed-group offers.

• Brand hijacking: Guests who start by searching your hotel’s name often see OTA ads bidding on your brand before they ever find your website.

• Lost loyalty: Too often, guests remember the OTA they booked with, not your hotel. That’s brand value slipping through your fingers.

• Weekend undercutting: Many hotels discover OTAs quietly discounting rates on metasearch late Friday or Saturday nights, when revenue teams are less or not active.

This is the point where OTAs stop looking like partners and start feeling like frenemies.

Bidding on Your Brand: Defend Your Own Turf

OTAs routinely bid on your brand name in Google and Bing Ads. If you’re not running your own brand campaigns, you’re letting them poach guests who were already looking for you.

Action points:

• Run branded PPC campaigns to reclaim those searches. Your ad should appear first when guests search your name.

• Use mobile-only direct offers in your campaigns to push guests towards booking directly with you. These offers can double as a driver for app adoption and repeat loyalty.

The irony? You may have to spend to defend your own brand. But every reclaimed booking saves you double-digit commission.

The Meta Search Problem: And Why Weekends Hurt

Metasearch is another battleground. OTAs often flex their pricing muscle with sudden undercuts, particularly at weekends. It’s no coincidence, that’s when many revenue managers aren’t actively monitoring parity.

Solutions:

• Invest in real-time rate shopping tools that alert you to undercuts immediately.

• Use direct-only perks like complimentary upgrades, early check-in or free breakfast to add value that OTAs can’t replicate, even if they drop the price.

• Have a weekend monitoring protocol in place. Automation is your ally here.

Advertising on OTAs: Playing Their Game

Here’s the controversial bit: sometimes it makes sense to advertise on OTAs themselves. Platforms like Expedia’s TravelAds or Booking’s sponsored listings allow you to pay for prime visibility.

The results can surprise you. One marketer on Reddit, reported spending just $449 on Expedia TravelAds and generating over $12,000 in attributed revenue. That’s an ROI you can’t ignore.

When to use OTA ads:

• To boost visibility in new markets where your brand is unknown.

• To push visibility during need periods when occupancy is low.

• To counter competitors dominating your city page listings.

Yes, you’re paying both commission and ad spend, but when the ROI stacks up, it can be a smart tactical move.

Rate Parity: Myth or Minefield?

Hotels are told to maintain parity across channels, but the reality is OTAs often find loopholes. Mobile-only discounts, closed-user groups or loyalty schemes mean they can quietly sell under your rate.

Your defence:

• Actively monitor all channels.

• Call out breaches in writing and demand accountability.

• Strengthen your direct proposition with perks OTAs cannot match.

Parity isn’t about being the cheapest everywhere. It’s about being the smartest with your value proposition.

Accountability: Numbers Don’t Lie

Distribution strategy without accountability is just guesswork. For every channel, track and report:

• CPA (Cost per Acquisition)

• Direct bookings vs OTA bookings

• Revenue uplift vs commission drain

• Impact of OTA ads vs brand PPC

• Effect of mobile-only or direct-only perks on conversion

Set monthly scorecards and hold each channel accountable. That way, you know whether OTAs are adding value or quietly eating away at profit.

The Balanced Verdict

So, are OTAs friend or foe? The answer is both. They’re your Marmite channel. Love them or hate them, they’re here to stay.

The trick is to stop seeing OTAs as your lifeline and start seeing them as one tool in your distribution mix. Use them to generate visibility, fill gaps in demand and open new markets. But make sure it’s your brand guests remember, your website they return to and your margins that stay healthy.

Your end game is simple: direct-first distribution. OTAs should complement, not dominate. Because the day they control your business is the day you lose control of your brand.

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